Appeal Details
Counselvise Citation
[2016] 122 COUNSELVISE.COM (IT) 1452 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
4 year(s) 10 month(s) 27 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
22-01-2016
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
A
Next Hearing Date
18-01-2016
Assessment Year
2002-2003
Appeal Filed On
25-02-2011
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH (BEFORE SHRI S.K. YADAV, JUDICIAL MEMBER & SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER) IT(SS)A. NOS: 115 TO 120/AHD/2011 & 788/AHD/10 (ASST. YEARS: 2001-02 TO 2007-08) SHRI DINESH TARACHAND KASAT 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ACFPK 3308N V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NOS: 259 & 260/AHD/2011 (ASST.YEARS: 2003-04 &2007-08) THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD V/S SHRI DINESH TARACHAND KASAT 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ACFPK 3308N (APPELLANT) (RESPONDENT) IT(SS)A. NOS: 215 TO 219/AHD/2011 (ASST.YEARS: 2001-02 TO 2003-04, 2006-07 & 2007-08) SHRI PRAKASH TARACHAND KASAT 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ACFPK3311H V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NOS: 265 TO 267/AHD/2011 (ASST.YEARS: 2003-04, 2006-07 & 2007-08) IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 2 THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD V/S SHRI PRAKASH TARACHAND KASAT 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ACFPK3311H (APPELLANT) (RESPONDENT) IT(SS)A. NOS: 220 TO 225/AHD/2011 (ASST. YEARS:2001-02 TO 2004-05, 2006-07 & 2007-08) SHRI RAJESH TARACHAND KASAT, 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ADBPK 6436E V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NOS: 261 TO 264/AHD/2011 (ASST.YEARS: 2003-04 & 2004-05, 2006-07 & 2007-08) THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD V/S SHRI RAJESH TARACHAND KASAT, 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ADBPK 6436E (APPELLANT) (RESPONDENT) IT(SS)A. NO: 227/AHD/2011 (ASST. YEAR: 2007-08) RACHANA DINESH KASAT 126, SUNRISE PARK, DRIVE- INROAD, AHMEDABAD PAN NO. AEWPK 5704K V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 3 IT(SS)A. NO: 245/AHD/2011 (ASST. YEAR: 2002-03) IT(SS)A. NO: 247/AHD/2011 (ASST. YEAR: 2002-03) SHRI JAGAT CHAMPAKLAL KASAT, 126, SUNRISE PARK, DRIVE-INROAD, AHMEDABAD PAN NO. ABTPK 9872 C V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NO: 505/AHD/2011 (ASST. YEAR: 2001-02) SHRI J.P. MARKETING, E/21, NEW MADHUPURA MARKET, SHAHIBAUG ROAD, AHMEDABAD PAN NO.AACFJ 5439N V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI G.C. PIPRA AR RESPONDENT BY : SHRI R.I. PATEL CIT/DR WITH G.C. DAXINI, SR. D.R. ( )/ ORDER DATE OF HEARING : 18 -01-20 16 DATE OF PRONOUNCEMENT : 22 -01-2016 CHAMPAKLAL S. KASAT, 126, SUNRISE PARK, DRIVE- INROAD, AHMEDABAD PAN NO. AFDPK 6483P V/S THE DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(3), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 4 PER BENCH: 1. THESE BUNCH OF APPEALS WERE HEARD TOGETHER AND ARE DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. REPRESENTATIVES OF BOTH THE SIDES AGREED THAT FACTS IN ISSUES ARE IDENTICAL IN ALL THESE APPEALS UNDER CONSIDERATION. ON THIS CONCESSION, WE HEARD THE APPEALS TOGETHER. THE LEARNED COUNSEL FILED A DETAILED CHART EXPLAINING THE FACTS IN ISSUES QUA THE GROUND S OF APPEAL. THE LD. D.R. FAIRLY CONCEDED THAT THE DETAILS EXHIBITED IN THE CHARTS ARE TRUE TO THE FACTS. THE FIRST COMMON GRIEVANCE RELATES TO TH E APPLICABILITY OF SECTION 44AF OF THE ACT. THE LEARNED COUNSEL FAIRLY CONCEDED THAT UNDER INSTRUCTIONS HE IS NOT PRESSING THIS GROUND. THEREFORE THE GROUND RELATING TO THE APPLICABILITY OF SECTION 44AF ALONG WITH SUB GROUNDS ARE DISMISSED. THE SECOND COMMON GRIEVANCE RELATES TO T HE ADDITION ON ACCOUNT OF LOW WITHDRAWAL FOR HOUSEHOLD EXPENSES. C ONSIDERED WITH THIS, THE OTHER COMMON GROUNDS RELATES TO THE ADDIT ION ON ACCOUNT OF ALLEGED INVESTMENTS RELYING UPON DVOS VALUATION RE PORT. THESE TWO ISSUES ARE TAKEN UP TOGETHER AS THEY REQUIRE COMMON ADJUDICATION. 3. A WARRANT OF AUTHORIZATION U/S. 132(1) OF THE ACT W AS ISSUED AND EXECUTED AT THE RESIDENCES OF THE ASSESSEES UNDER APPEAL. ACCORDINGLY PROCEEDINGS U/S. 153A WERE INITIATED AND THE ASSESS MENTS HAVE BEEN MADE U/S. 143(3) OF THE ACT READ WITH SECTION 153A OF THE ACT. ADDITIONS ON ACCOUNT OF HOUSEHOLD EXPENSES HAVE BEE N MADE ONLY ON THE ASSUMPTION THAT THE ASSESSEE HAS NOT SHOWN SUFF ICIENT WITHDRAWALS FOR HOUSEHOLD EXPENSES AND ADDITION FOR UNEXPLAINED INVESTMENT HAVE IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 5 BEEN MADE ON THE BASIS OF VALUATION MADE BY THE DVO ON THE INSTRUCTIONS OF THE ASSESSING OFFICER. 4. IT WOULD BE PERTINENT TO MENTION HERE THAT BOTH THE SE ADDITIONS HAVE BEEN MADE WITHOUT THERE BEING ANY INCRIMINATING MAT ERIAL FOUND AT THE TIME OF SEARCH. IT IS NOW WELL SETTLED PROPOSITION OF LAW THAT NO ADDITION CAN BE MADE IN THE ASSESSMENT MADE U/S. 153A OF THE ACT PURSUANT TO SEARCH AND SEIZURE OPERATIONS U/S. 132 OF THE ACT U NLESS SOME INCRIMINATING MATERIAL IS FOUND AT THE TIME OF SEAR CH. THIS PROPOSITION IS WELL SETTLED BY THE DECISION OF THE HONBLE HIGH COURT OF BOMBAY GIVEN IN THE CASE OF ALL CARGO GLOBAL LOGISTICS IN INCOME TAX APPEAL NO. 1969 OF 2013 AND CONTINENTAL WAREHOUSING CORPOR ATION IN INCOME TAX APPEAL NO. 523 OF 2013 AND ALSO IN THE CASE OF MURLI AGRO PRODUCTS. THE RELEVANT PORTION OF THE DECISION IN T HE CASE OF CONTINENTAL WAREHOUSING (SUPRA) READS AS UNDER:- 'ONCE IT IS HELD THAT THE ASSESSMENT HAS ATTAINED F INALITY, THEN THE AO WHILE PASSING THE INDEPENDENT ASSESSMENT ORDER U/S. 153A R.W. S 143(3) OF THE I.T. ACT COULD NOT HAVE DISTURBED THE ASSESSMENT/REASSESSMEN T ORDER WHICH HAS ATTAINED FINALITY, UNLESS THE MATERIALS GATHERED IN THE COUR SE OF THE PROCEEDINGS U/S. 153A OF THE INCOME TAX ACT ESTABLISH THAT THE RELIEFS GR ANTED UNDER THE FINALIZED ASSESSMENT/REASSESSMENT WERE CONTRARY TO THE FACTS UNEARTHED DURING THE COURSE OF 153A PROCEEDINGS. IF THERE IS NOTHING ON RECORD TO SUGGEST THAT ANY MATERIAL WAS UNEARTHED DURING THE SEARCH OR DURING THE 153A PROCEEDINGS, THE AO WHILE PASSING ORDER U/S. 153A R.W.S. 143(3) CANNOT DISTUR B THE ASSESSMENT ORDER.' 10.2. THE HON'BLE HIGH COURT HAD AN OCCASION TO C ONSIDER THE FOLLOWING QUESTIONS OF LAW: '1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE HON'BLE ITAT IS CORRECT IN NARROWING DOWN THE SCOPE OF ASSESSMENT U /S. 153A IN RESPECT OF IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 6 COMPLETED ASSESSMENTS BY HOLDING THAT ONLY UNDISCLO SED INCOME AND UNDISCLOSED ASSETS DETECTED DURING SEARCH COULD BE BROUGHT TO T AX? 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON'BLE ITAT IS CORRECT IN LAW IN HOLDING THAT THE SCOPE OF SEC. 15 3A IS LIMITED TO ASSESSING ONLY SEARCH RELATED INCOME, THEREBY DENYING REVENUE THE OPPORTUNITY OF TAXING OTHER ESCAPED INCOME, THAT COMES TO THE NOTICE OF THE A.O .? 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON'BLE ITAT WAS RIGHT IN LIMITING THE SCOPE OF SEC. 153A ONLY T O UNDISCLOSED INCOME WHEN AS PER THE SECTION THE AO HAS TO ASSESS THE TOTAL INCO ME OF THE SIX ASSESSMENT YEARS?'- AND THE HON'BLE HIGH COURT OF BOMBAY FINALLY HELD A S UNDER: ' WE, THEREFORE, DISMISS THE REVENUE'S APPEAL AND A NSWER THE SUBSTANTIAL QUESTION OF LAW AGAINST THE REVENUE AND IN FAVOUR OF THE ASS ESSEE'. 10.3. IN THE FACTS OF THE CASE IN HAND ARE CONSIDER ED IN THE LIGHT OF THE AFOREMENTIONED DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT. UNDISPUTEDLY, DURING THE COURSE OF THE SEARCH AND SEIZURE OPERATION, NOT A SINGLE PIECE OF PAPER WAS FOUND. 5. CONSIDERING THE FACTS IN THE LIGHT OF THE RATIO LAI D DOWN BY THE HONBLE HIGH COURT OF BOMBAY (SUPRA), WE DO NOT FIND ANY RE ASON/JUSTIFICATION IN MAKING THE IMPUGNED ADDITIONS. ACCORDINGLY WE SE T ASIDE THE FINDINGS OF LD. CIT(A) AND DIRECT THE A.O TO DELETE THE IMPUGNED ADDITIONS. GRIEVANCE RELATING TO ADDITIONS ON ACCOU NT OF HOUSEHOLD EXPENSES AND ADDITIONS ON ACCOUNT OF UNEXPLAINED IN VESTMENTS ARE ACCORDINGLY ALLOWED. 6. THE ABOVE FINDINGS WOULD ALSO COVER THE ADDITIONS M ADE ON ACCOUNT OF CAPITAL GAINS PURSUANT TO THE VALUATION MADE BY THE DVO IN ASSESSMENT 2002-03 IN ITA NO. 116/AHD/2011 AND ADDI TION OF RS. 5 LACS HAS ALSO BEEN CONTESTED BRIEFLY STATED THE FAC TS OF THIS ADDITION ARE IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 7 THAT DURING THE COURSE OF SEARCH PROCEEDINGS, A HAN D WRITTEN AGREEMENT DATED 01.07.2001 WAS FOUND AND SEIZED WHI CH CONTAINED CERTAIN SPECIFIC CONDITIONS WITH REGARD TO SETTLEME NT OF ACCOUNT BETWEEN PARTIES BOTH IN CASH AS WELL AS BY CHEQUE. THE CONCERNED PARTIES ARE THE PARTNERS OF PARTNERSHIP FIRM OF M/S . J.P. MARKETING, NAMELY SHRI CHAMPAKLAL KASAT, SHRI RAJESH KASAT AND SHRI DINESH KASAT. AS PER THIS AGREEMENT SHRI CHAMPAKLAL KASAT WOULD PAY RS. 10 LACS TO SHRI DINESH KASAT AND SHRI RAJESH KASAT, FO R SURRENDERING THEIR INTEREST IN THE FIRM. THIS PAYMENT WAS IN ADDITION TO THE AMOUNT PAYABLE BY CHEQUE. THE ASSESSEE WAS ASKED TO EXPLAI N WHY THE ADDITION SHOULD NOT BE MADE FOR THE RECEIPT OF RS. 5 LACS. THE ASSESSEE VEHEMENTLY STATED THAT NO SUCH TRANSACTION HAS EVER TAKEN PLACE. THIS EXPLANATION OF THE ASSESSEE DID NOT FIND FAVOUR WIT H THE A.O WHO MADE THE ADDITION OF RS. 5 LACS AS BUSINESS INCOME OF TH E ASSESSEE. ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) BUT W ITHOUT ANY SUCCESS. 7. BEFORE US THE COUNSEL FOR THE ASSESSEE REITERATED W HAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. IT IS THE SAY OF THE COUNSEL THAT THE ADDITIONS HAVE BEEN MADE ON THE BASIS OF A LOOSE PA PER FOUND AT THE TIME OF SEARCH, THE SAID LOOSE PAPER WAS FOUND FROM THE POSSESSION OF SHRI CHAMPAKLAL KASAT AND NOT FROM THE POSSESSION O F THE ASSESSEE. EXCEPT FOR THIS THE REVENUE HAS NO DOCUMENTARY EVID ENCE TO MAKE THE ADDITION. PER CONTRA, THE LD. D.R. STRONGLY SUPPORT ED THE ORDER OF THE REVENUE AUTHORITIES. WE HAVE GIVEN A THOUGHTFUL CON SIDERATION TO THE ORDER OF THE AUTHORITIES BELOW. UNDISPUTEDLY THE IM PUGNED ADDITION IS MADE ONLY ON THE BASIS OF LOOSE PAPER WHICH SHOWS T HAT CERTAIN PAYMENTS WERE MADE FOR ACQUIRING THE SHARE IN THE P ARTNERSHIP FIRM. ASSUMING YET NOT ACCEPTING THAT THE SAID PAYMENT WA S ACTUALLY MADE BUT THEN IT WAS MADE FOR ACQUIRING THE SHARE IN THE PARTNERSHIP FIRM. IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 8 THIS BY ITS VERY NATURE IS A CAPITAL RECEIPT IN THE HANDS OF THE ASSESSEE. THEREFORE ASSUMING YET NOT ACCEPTING THAT EVEN THIS TRANSACTION HAS TAKEN PLACE IT IS A CAPITAL RECEIPT WHICH CANNOT JUSTIFY THE IMPUGNED ADDITIONS. WE ACCORDINGLY SET ASIDE TH E FINDINGS OF LD. CIT(A) AND DIRECT THE A.O TO DELETE THE IMPUGNED AD DITION OF RS. 5 LACS MADE ON ACCOUNT OF UNACCOUNTED CASH RECEIPTS. 8. THE CROSS APPEALS OF THE REVENUE WILL BECOME OTIOSE QUA ARE DECISIONS IN THE CASE OF ASSESSEES APPEAL. 9. HAVING DECIDED THE COMMON ISSUES INVOLVED IN THE CA PTIONED APPEALS WE WILL NOW TAKE UP THE ISSUES WHICH ARE INDEPENDEN T. 10. (1) IT(SS)A NO. 215/AHD/2011. THE SOLE GRIEVANCE RELATES TO THE ADDITION OF RS. 18,000/- MADE U/S. 68 OF THE AC T. WHILE SCRUTINIZING THE RETURN OF INCOME, THE A.O NOTICED THAT THE ASSE SSEE HAS BORROWED LOAN FROM SHRI JEETUBHAI AMOUNTING TO RS. 18,000/-. ASSESSEE WAS ASKED TO EXPLAIN THE CREDIT IN THE LIGHT OF THE PRO VISIONS OF SECTION 68 OF THE ACT. ASSESSEE FILED A CONFIRMATION LETTER. T HE A.O WAS OF THE OPINION THAT MERE FILING OF COPY OF ACCOUNT ALONG W ITH CONFIRMATION DOES NOT SUBSTANTIATE THE CLAIM. THE A.O MADE THE A DDITION OF RS. 18,000/- U/S. 68 OF THE ACT. 11. THE ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) A ND TO SUBSTANTIATE THE CLAIM AN AFFIDAVIT WAS FILED. THE LD. CIT(A) DID NOT ACCEPT THE AFFIDAVIT STATING THAT THE ASSESSEE COUL D NOT EXPLAIN WHY THE SAME WAS NOT FILED BEFORE THE A.O. THUS THE ADDITIO NAL EVIDENCE IN THE FORM OF AFFIDAVIT WAS NOT ACCEPTED. AGGRIEVED BY TH IS THE ASSESSEE BEFORE US. THE COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 9 STATED BEFORE THE LOWER AUTHORITIES. THE D.R. SUPPO RTED THE FINDING OF REVENUE AUTHORITIES. WE HAVE GIVEN A THOUGHTFUL CON SIDERATION TO THE ORDER OF THE AUTHORITIES BELOW. WE HAVE ALSO GONE T HROUGH THE AFFIDAVIT FILED BEFORE THE LD. CIT(A). IN OUR CONSIDERED OPIN ION THE LD. CIT(A) SHOULD NOT HAVE RUBBISHED THE AFFIDAVIT WITHOUT GOI NG INTO THE MERITS. THEREFORE IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE RESTORE THIS ISSUE TO THE FILES OF THE A.O. THE A.O IS DIRECTED TO DEC IDE THE ISSUE AFRESH IN THE LIGHT OF THE CONTENTS OF THE AFFIDAVITS. KEEPIN G IN MIND, THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF MEHTA PAREKH & COMPANY 30 ITR 181. THIS GROUND IS TREATED AS ALLOW ED FOR STATISTICAL PURPOSES. 12. (2) IT(SS)A NO. 221/AHD/2011. THE ASSESSEE IS A GGRIEVED BY THE ADDITION OF RS. 5 LACS TREATED AS UNACCOUNTED C ASH RECEIPT ON SURRENDER OF INTEREST IN M/S. J.P. MARKETING. THIS ISSUE HAS BEEN DECIDED BY US IN ITA NO. 116/AHD/2011 QUA GROUND NO . 3 OF THAT APPEAL. FOR OUR DETAILED DISCUSSION THEREIN AND FOR SIMILAR REASONS, THE ADDITION OF RS. 5 LACS IS DELETED. 13. (3) IT(SS)A NO. 227/AHD/2011 RACHANA D. KASAT FOR A.Y. 2007-08. THE COUNSEL DID NOT PRESS THIS APPEAL AND THEREFORE THE SAME IS DISMISSED AS NOT PRESSED. 14. (4) IT(SS)A NO. 247/AHD/2011 JAGAT CHAMPAKLAL KAS AT. THE SOLE GRIEVANCE RELATES TO THE ADDITION OF RS. 4,59, 000/-.THIS ISSUE HAS BEEN ELABORATELY DISCUSSED AND CONSIDERED BY US, WH ILE DECIDING THE COMMON ISSUES. FOR SIMILAR REASONS, WE DIRECT THE A .O TO DELETE THE ADDITION OF RS. 4,59,000/-. IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 10 15. (5) IT(SS)A NO. 245/AHD/2011 CHAMPAKLAL KASAT. THE SOLE GRIEVANCE OF THE ASSESSEE RELATES TO THE ADDITION O F RS. 10 LACS TREATED AS UNEXPLAINED EXPENDITURE. IDENTICAL ISSUES HAVE B EEN CONSIDERED BY US IN THE HANDS OF RAJESH KASAT AND DINESH KASAT WH O WERE THE ALLEGED RECIPIENTS OF THIS AMOUNT EQUALLY. SINCE IN THOSE CASES, WE HAVE DISCARDED THE EVIDENTIARY VALUE OF THE LOOSE P APER, FOR SIMILAR REASONS, WE DIRECT THE A.O TO DELETE THE ADDITION O F RS. 10 LACS. 16. (6) IT(SS)A NO. 505/AHD/2011.THE SUM AND SUBSTAN CE OF THE GRIEVANCE OF THE ASSESSEE IS THAT LD. CIT(A) ERRED IN CONFIRMING THE PENALTY OF RS. 1,09,532/- LEVIED BY THE A.O U/S. 27 1(1)(C) OF THE ACT. DURING THE COURSE OF THE SCRUTINY ASSESSMENT PROCEE DINGS, THE A.O NOTICED THAT THE ASSESSEE HAS PURCHASED DELIVERY VA NS AMOUNTING TO RS. 15,67,859/- ON WHICH IT CLAIMED DEPRECIATION OF RS. 5,44,256/- BEING 40%. THE A.O FURTHER FOUND THAT SOME OF THE V ANS WERE PURCHASED BEFORE SEPTEMBER 2000 AND SOME WERE PURCH ASED AFTER SEPTEMBER 2000. THE A.O WAS OF THE FIRM BELIEF THAT HIGHER RATE OF DEPRECIATION IS ALLOWABLE ON VEHICLES PURCHASE AFTE R 01.10.1998 BUT BEFORE 01.04.1999. SINCE THE VEHICLES PURCHASED BY THE ASSESSEE DO NOT FULFILL THE CRITERIA, THE HIGHER DEPRECIATION C LAIMED WAS DENIED. PENALTY PROCEEDINGS U/S. 271(1)(C) WERE INITIATED F OR THE EXCESSIVE CLAIM OF DEPRECIATION. 17. DURING THE COURSE OF PENAL PROCEEDINGS, THE ASSESSE E WAS ASKED TO SHOW CAUSE WHY PENALTY SHOULD NOT BE LEVIED. ASS ESSEE STRONGLY CONTENDED THAT IT WAS UNDER A BONA FIDE BELIEF THAT IT WAS ENTITLED FOR HIGHER RATE OF DEPRECIATION. THEREFORE IT CANNOT BE SAID THAT ASSESSEE CONCEALED THE PARTICULARS OF INCOME OR FILED INACCU RATE PARTICULARS OF INCOME. THE CONTENTION OF THE ASSESSEE DID NOT FIND FAVOUR WITH THE IT(SS)A NOS. 788/AHD/ 10, 115 TO 225/AHD/11 259 TO 267/AHD/11, 22 7, 245, 247 & 505/A/11 A.YS. 2002-02 TO 2004- 05, 2006-07 & 2007-08 . 11 A.O WHO LEVIED PENALTY OF RS. 1,09,532/-. AGGRIEVED BY WHICH THE ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) BUT W ITHOUT ANY SUCCESS. 18. BEFORE US, THE COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. PER CONTRA, TH E LD. D.R. STRONGLY SUPPORTED THE FINDINGS OF THE A.O. 19. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ER OF THE AUTHORITIES BELOW. UNDISPUTEDLY THE ASSESSEE CLAIME D DEPRECIATION WHICH WAS NOT PERMISSIBLE DURING THE PERIOD IN WHIC H THE DELIVERY VANS WERE PURCHASED. HOWEVER, IN OUR CONSIDERED OPINION A MERE MAKING OF A CLAIM WHICH IS NOT SUSTAINABLE IN LAW WILL NOT AM OUNT TO FURNISHING INACCURATE PARTICULARS. WE DRAW SUPPORT FROM THE DE CISION OF HONBLE SUPREME COURT IN THE CASE OF RELIANCE PETRO PRODUCT S PVT. LTD. 332 ITR 158. 20. RESPECTFULLY FOLLOWING THE RATIO LAID DOWN BY THE H ONBLE SUPREME COURT. WE SET ASIDE THE FINDINGS OF LD. CIT (A) AND DIRECT THE A.O TO DELETE THE PENALTY OF RS. 1,09,532/-. APPEAL FILED BY THE ASSESSEE IS ACCORDINGLY ALLOWED. 21. IN THE RESULT, THE APPEAL OF REVENUE AND ASSESSEE A RE PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 22 - 01 - 201 6. SD/- SD/- (S. K. YADAV) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: TRUE COPY
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